‘Lack of understanding of work’: Business group criticises Daniel Andrews’ plan to give sick pay to casuals

skills shortages

The Victorian government is creating a nation-first program which will see casual workers receive paid sick leave, but COSBOA says the initiative shows a “deep lack of understanding” of the work environment.

The ‘secure work pilot scheme’ will provide casual workers in industries with high rates of casualisation, such as hospitality and aged care, up to five days of sick and carer’s pay at the minimum wage.

The initial two-year pilot will be funded by the Victorian government at no cost to businesses, however, any ongoing scheme will be funded with an industry levy.

“Workers staying on the job when they’re sick is bad for business — for the rest of your staff and for your customers. We believe this scheme will benefit businesses and workers right across Victoria,” Victorian Treasurer and Minister for Industrial Relations Tim Pallas said in a statement on Monday.

COVID-19 outbreaks in workplaces and hotel quarantine have been linked to the casualised workforce this year, after staff working multiple jobs turned up to work sick.

But Council of Small Business Organisations Australia CEO Peter Strong tells SmartCompany the program raises more questions than it answers.

“The whole idea of ‘casual’ is that it’s there because you can’t predict the work,” Strong says.

Many businesses manage fluctuating workloads by hiring casual staff for short periods of time and pay higher wages to compensate for the leave entitlements casuals do not get, Strong says.

Strong acknowledges the issue of casual staff working consistently high hours or even full-time hours should be addressed, however, the danger of offering sick leave to casuals is that insecure employment will become more desirable.

“It means casuals could get paid less, or being a casual worker will be more attractive than being permanent or permanent part-time,” Strong says.

Many questions remain about the scheme, including how long a casual staff member must be employed to qualify for sick leave, and how the industry levy would work.

Federal Industrial Relations Minister Christian Porter quickly lashed out at the Victorian government’s plan, saying it would result in “a massive tax on Victorian businesses”.

“It seems to start with a small, government-funded pilot and intends to finish with what would be a massive tax on Victorian businesses,” Porter said.

“[Businesses] would be forced to pay for both a 25% additional loading in wages to compensate for casuals not receiving sick leave, and then having to pay for an industry levy to fund sick leave as well.”

The Victorian budget will allocate $5 million to the two-year pilot scheme, which is expected to begin in late-2021 or early-2022.

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